As entrepreneurs, one of the most difficult decisions we face is having to terminate employees. When an employee is being fired for poor performance, the decision is usually easier because poor performers can have a negative impact and they are probably not enjoying their job anyhow. What is more difficult is having to fire good employees for financial reasons.

A friend and current colleague of mine gave me some valuable advice, which I adapted to my own style and situation on a couple of occasions when cash was low and revenues were slow to come in: rather than firing employees outright, give them the option to reduce their workload to half time for a pre-determined, limited period. Tell them clearly that you value their work but are forced to do this for financial reasons. And give them a candid assessment of the situation, making it clear that unless things improve in the interim, they will be let go at the end of the half-time period.

Financially, your cost will be roughly the same: most employees get some sort of severance, even if it’s just two-weeks notice. You can double that period at half time, e.g., give them two months at half time instead of one-month severance, and your cash outlay is essentially the same. You may pay a bit more in benefits, but your cash outlay is spread out over a longer period. More importantly, this approach has several potential benefits for your employees and for your company.

For your employees:

They can have an extended period during which they can look for work without the stigma of being unemployed.

The half-time employment will give them plenty of time to look for work while maintaining a routine.

They will be able to continue benefits for the extra time, something particularly valuable for anyone with a family.

For your company:

In most cases, employees will continue to be productive at half time, whereas if you terminate them you will get no productivity.

If you suddenly get that client you were hoping to get, you might be able to bring the employees back on – saving time and money from having to re-hire someone, and reducing the risk that you won’t be able to meet client demand.

This approach can be much less disruptive to the employees you are keeping: especially if you are in a small company and laying off more than one person.

When I have had to go through this situation, I took the time to have one-on-one conversations with everyone in the company. First, I spoke with each of the people that we needed to cut. Then I spoke with everyone else to let them know that this was happening, that it was a transient phase, and that I counted on them to continue to contribute. Finally, we held a company meeting where we talked openly about the situation, to avoid the spread of rumors and panic.

The outcome was great: rather than spreading panic, everyone expressed appreciation for the way the situation was handled, and continued to be productive members of the team. Furthermore, some other employees volunteered to cut back to 4 days a week during the summer to give us even greater financial flexibility while enjoying a bit of time off.

The end of the story was even better: a few weeks later, we finally got a large contract. We were able to handle the client demand, restore one person to full-time, and extend the half-time work of others.

Paolo Gaudiano is founder of Infomous, which is trying to revolutionize the way users, publishers and advertisers interact with online content. He began his career in academia, reaching the position of tenured Associate Professor at Boston University. In 2001 he joined Icosystem, which spun off Infomous in 2011. Paolo holds a BS in Applied Mathematics, an MS in Aerospace Engineering and a PhD in Cognitive and Neural Systems.

When scaling a company, it’s the easy things that become most difficult. Whether you’re bringing on new employees, organizing team workloads, or simply trying to keep open lines of communication, bigger teams often mean bigger headaches.

In five years, Xtreme Labs has grown from an office of eight to a staff of 250.

While many companies stumble at this point, our business goals for 2013 require us to bring on 100 more people by year’s end. How did we reach this point and what will allow us to meet the growth required for 2013, you ask?

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Here are three tips that every growing software company needs to consider in order to grow consistently, efficiently and effectively.

Hire fast, fire faster

Interviews are a terrible predictor of performance. Candidates often test as false positives and false negatives. For example, a candidate could have the ideal skill-set for the position, but may not have put her best foot forward in a two-hour interview. When software companies ask coding questions, expect answers on whiteboards, and disqualify for giving the wrong answer, they are forgetting that most people don’t write code on whiteboards.

This scenario sets the candidate up to fail because it forces her to use a method that few engineers use in their regular workday.

The opposite may also happen: she may have mastered the interview, but is an incompatible fit in skills or culture. How do you counteract these scenarios?

Don’t drop the concept of a defined interview process altogether. Instead, recognize that interviews aren’t perfect. Ask challenging questions that try to establish how the candidate thinks, and don’t disqualify someone for giving the wrong answer.

Organize your work environment to be a good indicator of whether or not an individual is a good fit relatively quickly. This is a better predictor of performance because it uses real in-work data instead of interview data. Instead of trying to create questions that elicit a symptom of fit, build performance indicators directly into the culture and work experience. A lot of companies follow a “hire slow, fire fast” mentality, which involves an extremely rigorous interview process but often results in throwing the baby out with the bathwater.

Instead of using the interview as the proxy for performance, use an internship or a few months of work experience, for valid, real-world data. Recognize that “the map is not the territory;” a great interviewee is not equivalent to a great employee.

Monotasking = efficiency

In multitasking, the time it takes to switch between tasks, also known as the context switch, becomes extremely expensive as more and more tasks are attempted simultaneously. When you examine context switching costs in aggregate, it’s clear that multitasking wastes a lot of time.

People often think the end-goal is to be the most efficient multitasker possible. They take joy and relief, in catching up on their e-mails during a meeting. However, multitasking often leads to messing two things up simultaneously. Should we be rewarding employees for this behavior?

Emphasize the idea of monotasking—doing one thing at a time.

Implement processes like pair programming that allow your engineers to monotask. Teams of two that are accountable to each other are less likely to get distracted by e-mail, the Internet and social networks. Consider organizing an open, agile team room where everyone can see what others are up to.

Don’t let the calendar dictate when to meet

It’s extremely difficult to have an effective one-on-one meeting.

People are busy and often don’t prepare properly. An effective one-on-one requires both sides to be in the right mindset and to queue up topics, requiring regular bookkeeping. However, these necessities usually don’t coincide in the real world, and the reason why is simple: A career reflection moment is unlikely to happen during a scheduled one-on-one.

When an issue arises, come together and fix it right away. Being available to host an impromptu meeting allows employees to grab you for a chat while the topic and context are fresh. It’s also possible to combine the merits of an unscheduled one-on-one with a 15 or 20-minute lag time in order for both sides to prepare properly.

As companies grow in size, coordination costs increase. As headcount increases so does the overall communication. A potential alternative to unscheduled one-on-ones is to host scheduled meetings, and cancel them if neither side needs it. At the end of the day, everyone has their own management style, and it important for managers to remain flexible when communicating with their team.

Filtering out candidates post-hire, monotasking, and impromptu meetings, are just a few of the principles we’ve used at Xtreme Labs to guide our growth while protecting our company culture.

If you’re managing a fast-growing company, we hope they come in handy for you too.

Named one of “Toronto’s Top 25 Most Powerful People,”Farhan Thawar is a well-known and respected figure inthe Canadian tech community. Before joining the Xtreme team, Farhan heldpositions of Chief Software Architect at I Love Rewards, the Head of Search & MSN Platform for Microsoft Canada and Technical Lead at Trilogy Software. In addition to being a programming and engineeringguru for Xtreme Labs, Farhan also uses his wealth of industry andmobile expertise to mentor aspiring mobile and tech startups.

Apple has reportedly fired Richard Williamson, the man in charge of Apple Maps. The version of the mapping app launched in iOS 6 bombed with consumers, resulting in an apology from chief executive Tim Cook.

Williamson, the senior director of iOS platform services, was fired by senior vice president Eddy Cue, according to Bloomberg’s sources. Williamson was one of the executives in charge of the highly anticipated Apple Maps, which replaced competitor Google’s maps app. When it launched with iOS 6 in September, it became very apparent that the app had a lot of bugs — more bugs than were justifiable under a “beta” label.

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For example, the app showed failed 3D images of drooping bridges and placed a Chinese restaurant in the middle of a body of water. It also didn’t provide accurate directions, resulting in a parody video of Batman failing to save someone because of it.

Tim Cook apologized in a letter to customers after the backlash, saying, “We fell short on this commitment. We are extremely sorry for the frustration this has caused our customers and we are doing everything we can to make Maps better.”

Apple even suggested other maps apps that customers could use while Apple improves the product.

]]>0Apple reportedly fires Apple Maps leadNew York startup Profitably loses all but one employee, CEO Adam Neary (exclusive)http://venturebeat.com/2012/03/23/exclusive-new-york-startup-profitably-loses-all-but-one-employee-ceo-adam-neary/
http://venturebeat.com/2012/03/23/exclusive-new-york-startup-profitably-loses-all-but-one-employee-ceo-adam-neary/#commentsFri, 23 Mar 2012 12:37:32 +0000http://venturebeat.com/?p=406298Profitably, a startup trying to bring deep financial analytics to small and medium businesses, was founded two years ago, in March of 2010. Exactly one year ago this week we reported that the company raised $1.1 million in seed funding to grow its team. But in the last week, things have gone from bad to worse, […]
]]>Profitably, a startup trying to bring deep financial analytics to small and medium businesses, was founded two years ago, in March of 2010. Exactly one year ago this week we reported that the company raised $1.1 million in seed funding to grow its team.

But in the last week, things have gone from bad to worse, leaving CEO Adam Neary as the only full-time employee still with the company.

The company was part of the first class at New York’s General Assembly, and Neary recorded in detail how being a part of the hot co-working space helped to double the size of their seed round. Profitably pulled financial data from a service like Quickbooks and showed small business owners where they were succeeding and what their trouble spots were. Then it offered concrete recommendations for how to build on that success.

Sources began reaching out last week to say something was up with Profitably. When I first heard the company was in trouble, I contacted Neary to get his perspective on what was happening. The rumor was the company was shutting down. He responded by email:

It’s really not that simple. I definitely appreciate you reaching out to me ahead of publishing. The reality is, we’re signing up 200-250 small businesses every week. We’ve just rebuilt our platform from the bottom up to handle all the traffic we’re seeing, and right now we’re making some tough personnel decisions in terms of setting ourselves up for the next phase of the company’s growth.

The above is not a throwaway PR line–it’s where we are. The members of our team have wives. We have children at home. We’ve all left very lucrative careers to try to do our best to build a product for the country’s small businesses, it’s tough work, and none of these decisions are being made lightly.

Bottom line–it wouldn’t be appropriate for me to get into the details of various staffing decisions we’re making right now, but please give me the benefit of the doubt that it’s not as simple as “you laid off most employees and are bootstrapping.” Given the traction we’ve been seeing and a number of fantastic partnerships we’re pursuing, that would obviously paint a false picture of where the company stands and gloss over some pretty subtle stuff.

I’m doing my best to show everybody involved as much respect as possible–I hope you do the same!Warm regards,Adam

It was difficult for me to sort out the discrepancy between Neary’s email and what I had heard. I knew that one of the company’s co-founders, CTO Francis Hwang, had left in November, and the rest of the team had left or been let go last week. Shortly after I got hold of an email from Neary himself, written to investors. It paints a different portrait of what happened, and where the company might go from here. The email from Neary is after the jump.

Continue Reading ...]]>0New York startup Profitably loses all but one employee, CEO Adam Neary (exclusive)Simply Hired fires a big part of its staff (exclusive)http://venturebeat.com/2012/02/02/simplyhired-fires-20-percent-of-staff-exclusive/
http://venturebeat.com/2012/02/02/simplyhired-fires-20-percent-of-staff-exclusive/#commentsFri, 03 Feb 2012 00:08:02 +0000http://venturebeat.com/?p=385203Updated at 5:03 p.m. PT with more info about which teams were let go. VentureBeat has learned that job search startup Simply Hired has laid off approximately 20 percent of its staff, according a source close to the company. After repeated queries, the company would neither confirm nor deny the percentage of staff that it […]
]]>

Updated at 5:03 p.m. PT with more info about which teams were let go.

VentureBeat has learned that job search startup Simply Hired has laid off approximately 20 percent of its staff, according a source close to the company.

After repeated queries, the company would neither confirm nor deny the percentage of staff that it had laid off. However, it did admit that it had “consolidated” and “expanded operations offshore,” which means the Sunnyvale, Calif.-based startup has let go of at least some U.S. staffers. We left the door open for more information from the company, but it would only give us the following statement:

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“As part of its 2012 strategy, Simply Hired made some changes to its organization,” said Simply Hired CEO Gautam Godhwani via e-mail. “We consolidated Bay Area operations to our new headquarters in Sunnyvale and expanded operations offshore. These changes were implemented at the start of the year as part of our annual planning process. The company is profitable with continued growth in Q1.”

Additionally, a second tipster has informed us that President/COO Dion Lim, VP of Sales Brian Corey, the QA team, and most of the sales team were let go in the layoffs.

Simply Hired competes with other job search sites like Monster, Indeed, LinkedIn, and Dice. In mid-2010, the company took a big step with Facebook integration that would let you look up jobs based on where your friends work. As of today, the company counts LinkedIn, Twitter, PCWorld, BusinessWeek, and CNNMoney.com as partner sites. The company wouldn’t confirm how many employees it has, but 92 people listed themselves as employees of SimplyHired in professional profiles on LinkedIn.

In a second case of irony, Simply Hired owns the website www.simplyfired.com. When you go to simplyfired.com, the site re-directs to simplyhired.com. With regard to the layoffs, that’s unfortunate.

Simply Hired has raised $22.3 million in funding to date. It last raised $4.6 million in fourth-round capital in August 2009 from IDG Ventures and Foundation Capital. The company also had prior investments from Fox Interactive Media, Garage Technology Ventures, Ron Conway, Dave McClure, Guy Kawasaki, James Hong, and others.

If you know any other details about the Simply Hired layoffs (or any other pressing news), please drop us a line at tips@venturebeat.com.

]]>0Simply Hired fires a big part of its staff (exclusive)Report: Meg Whitman will likely be named HP’s new CEO later today (updated)http://venturebeat.com/2011/09/22/meg-whitman-hp-ceo/
http://venturebeat.com/2011/09/22/meg-whitman-hp-ceo/#commentsThu, 22 Sep 2011 16:49:05 +0000http://venturebeat.com/?p=334484Former eBay CEO and Calif. governor hopeful Meg Whitman will likely be named the new full-time CEO of Hewlett-Packard after markets close later today, according to All Things D. Whitman will replace current HP boss Léo Apotheker, who has attracted much criticism after shaking up the company in the last few months. Apotheker recently laid […]
]]>Former eBay CEO and Calif. governor hopeful Meg Whitman will likely be named the new full-time CEO of Hewlett-Packard after markets close later today, according to All Things D.

Whitman will replace current HP boss Léo Apotheker, who has attracted much criticism after shaking up the company in the last few months. Apotheker recently laid off 500 employees in HP’s WebOS division, killed the WebOS-equipped TouchPad after just six weeks on the market, bought software firm Autonomy for $10 billion and announced he would explore spinning off HP’s PC division.

HP has had seven different CEOs since 1999, and Apotheker has only been at it for 11 months. Apotheker replaced former head Mark Hurd, who was fired in August 2010 over allegations related to improper expense reports and an embarrassing sexual harassment investigation.

HP’s stock price has dropped more than 40 percent since Apotheker announced his plan to change HP from one of the largest hardware businesses in the world into an enterprise software player.

Whitman seems a decent candidate as replacement CEO based on her history. She took eBay from a small startup to a multibillion-dollar powerhouse. But her expertise is focused on the consumer market, and she has never run a large hardware company with major enterprise clients. At eBay, her record was mixed and she (and her successor) failed to make the acquisition of Skype work in the company’s favor.

]]>0Report: Meg Whitman will likely be named HP’s new CEO later today (updated)Bartz’s comments about Yahoo’s board could cost her money — like $10Mhttp://venturebeat.com/2011/09/08/bartz-violated-contract/
http://venturebeat.com/2011/09/08/bartz-violated-contract/#commentsFri, 09 Sep 2011 05:39:14 +0000http://venturebeat.com/?p=328919Former Yahoo CEO Carol Bartz might be at risk of losing money from her severance package due to offensive comments made about company’s board of directors in an interview published Thursday. Yahoo put a non-disparagement clause in Bartz’s employment contract, according a report by Fortune that cites an unnamed source with close ties to the […]
]]>Former Yahoo CEO Carol Bartz might be at risk of losing money from her severance package due to offensive comments made about company’s board of directors in an interview published Thursday.

Yahoo put a non-disparagement clause in Bartz’s employment contract, according a report by Fortune that cites an unnamed source with close ties to the company. If that clause is violated, Yahoo can deny Bartz the lucrative payout of $10 million for her termination.

Bartz, who spent 32 months as CEO of Yahoo, called Yahoo’s board a bunch of “doofuses” in an email to the company’s employees. In her first public interview since the firing, she told Fortune that the board “fucked me over” and proceeded to criticize the company’s decision to remove her from the position.

Given Bartz’s colorful history of offensive — and often profane — public remarks, it would make perfect sense for Yahoo to add a non-disparagement clause to her contract.

The only question that remains is whether Bartz actually violated that clause with her comments earlier in the week.

]]>0Bartz’s comments about Yahoo’s board could cost her money — like $10MCarol Bartz says Yahoo “f—ed me over,” and f—s over Yahoo in the processhttp://venturebeat.com/2011/09/08/carol-bartz-says-yahoo-f-ed-me-over-and-f-s-over-yahoo-in-the-process/
http://venturebeat.com/2011/09/08/carol-bartz-says-yahoo-f-ed-me-over-and-f-s-over-yahoo-in-the-process/#commentsThu, 08 Sep 2011 17:54:50 +0000http://venturebeat.com/?p=328588Barely 24 hours after getting fired from her position as CEO via a phone call from Yahoo’s chairman of the board, Carol Bartz tells Fortune, “These people fucked me over.” It’s sad that in her first interview since the firing, she’s undermining Yahoo — putting her own raw emotions over the company she was previously entrusted to […]
]]>Barely 24 hours after getting fired from her position as CEO via a phone call from Yahoo’s chairman of the board, Carol Bartz tells Fortune, “These people fucked me over.”

It’s sad that in her first interview since the firing, she’s undermining Yahoo — putting her own raw emotions over the company she was previously entrusted to lead.

Read the Fortune interview. She unloads everything and doesn’t hold back. It’s very telling. This is truly Bartz’s personality. She regularly comes unglued, and this is not the first time she’s told someone to “fuck off” in public.

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Even before her call to Fortune last night, it was easy to start questioning the wisdom of her bluntness: She had emailed Yahoo’s 13,400 employees to tell them she’d been fired over the phone — and did so immediately after Yahoo Chairman Roy Bostock called her.

Market analysts have been furiously debating the wisdom of that first action by Bartz, because it contradicts the traditional candor in corporate America. (There’s a great piece in the New York Times about this today.)

So, is this public display by Bartz a dose of refreshing honesty, and thus therapeutic for everyone concerned? No. It’s a misguided lack of restraint that hurts herself and her former company.

As CEO, Bartz was charged with caring for shareholders’ interests, but in the interview with Forbes she does the exact opposite by calling the board “doofuses.” It’s worth noting that even as she calls the board names and attacks their decision, she provides no real evidence of how they actually screwed her over.

Keep in mind that Bartz agreed to take the top job at Yahoo two and a half years ago with the intention of restoring order to the position — and she did so after meeting the board. In the time since then, she wasn’t able to improve Yahoo’s performance. The company’s stock hasn’t gone anywhere. Yahoo’s market share has declined in the areas it’s most active in. A realistic person would understand that as CEO of a major company, your performance is inevitably going to come under scrutiny.

In fact, given Bartz’s past behavior, her termination should have come to a head much sooner. Bartz has bungled many times, never clearly defining the company’s vision in crucial situations.

Again, whether you like Bartz’s personal candor or not, she’s not been very clear on why she’s been “fucked over.” That lack of articulation is the real problem. Emotion is fine if it’s backed up. But Bartz’s emotion is not.

Later in the interview with Forbes, Bartz says she doesn’t want employees to think she abandoned them. Yet, by attacking the board needlessly, she’s actually making it harder for the very same employees she shows concern for. She’s hurting the brand, and when you do that it hurts the employees.

It’s sad to see Bartz self-destruct like this. The valley needs more strong female leaders, and Bartz once enjoyed widespread respect for what she’d accomplished in her long career before Yahoo. In the past, she arguably set a positive example for female executives in this industry. It makes her recent behavior all the more tragic, because it’s tarnished her once admirable character.

]]>0Carol Bartz says Yahoo “f—ed me over,” and f—s over Yahoo in the process5 things you should never say in an exit interviewhttp://venturebeat.com/2010/10/04/5-things-you-should-never-say-in-an-exit-interview/
http://venturebeat.com/2010/10/04/5-things-you-should-never-say-in-an-exit-interview/#commentsMon, 04 Oct 2010 13:00:24 +0000http://venturebeat.com/?p=217594(Editor’s note: Curtis Smolar is a partner at Ropers Majeski Kohn & Bentley. He submitted this column to VentureBeat.) Exit interviews are important tools to uncover potential legal liability early and learn if there are morale (or other) problems in an organization. Done wrong, though, they can land you in some hot water. As such, […]
]]>(Editor’s note: Curtis Smolar is a partner at Ropers Majeski Kohn & Bentley. He submitted this column to VentureBeat.)

Exit interviews are important tools to uncover potential legal liability early and learn if there are morale (or other) problems in an organization. Done wrong, though, they can land you in some hot water. As such, it’s best to follow certain guidelines when conducting these talks.

For example, create a script of general questions. And always have a neutral third party or someone from another department conduct the interview.

As a practical matter, remember that leaving is a highly emotionally charged situation and try to be empathic to the employee. And never forger that while the exit interview may be confidential for the employee, it is not for you and the employee may repeat to anyone else what you said. As such, work with your legal department or outside counsel to ensure that the questions you ask don’t violate the law.

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In that spirit, here are five things you should never say or ask during an exit interview:

“Can we just talk about why you are leaving?” – This is generally a terrible idea. If a person has decided to leave, it is your job at the exit interview to learn as much as possible about why they are leaving while balancing the employee’s feelings and rights. An unstructured conversation creates the potential of the employee feeling singled out, blamed, and/or that his or her rights are being violated in some way (whether they are or not).

By asking standard questions with the help of a skilled employment lawyer, you can achieve your goal of finding out valuable information about your organization without opening up your company to any potential lawsuits.

“Where are you going to work next?” – While the question itself may not be inappropriate, you could be setting yourself up for trouble if the employee’s offer gets revoked or if they get fired from the next job. The employee might allege that you badmouthed them to the new employer and that is why they got fired from the new job.

The best approach is to say good luck and concentrate on gathering information that would be beneficial.

“Did you ever experience any inappropriate behavior? Was Bob hitting on you? He does that you know.” – Where to begin on this one? The question actually implies that the organization knows that Bob sexually harasses employees, the company endorses it and yet they are allowing another employee who works for him to resign.

While an exit interview can be a very valuable tool to determine if there are problems in the work environment, it is not a good idea to suggest to the leaving employee that their supervisor was doing something that could create liability for the company. Instead, through carefully crafted questions, you could find out if there are complaints about a supervisor. These questions could include questions like “how was it to work with Bob?”

If the employee tells you that Bob sexually harasses everyone it could lead to doing an internal investigation to determine the situation.

“Will you sign this release in exchange for the money we owe you to date?” – Payment for past performance, in many states, is not consideration for a release from an employee. Instead, what you should do is offer the employee severance, which is above and beyond any amount owed for back salary, sick days, vacation and/or any other outstanding payment owed.

Also, you have to be careful that the employee does not feel coerced to sign the agreement, which may affect the validity of the release.

“If you go and work for our competitor we will sue you.” – The exit interview is a good time to remind the employee that they have a confidentiality agreement or a non-compete (for states that allow it). It is also a good idea to remind the employee of any other contract provisions that might survive their termination from the company, e.g. arbitration clauses. That said, you do not want to be threatening employees on their way out the door.

Overall, when doing business in the U.S., an exit interview is a good place to get valuable information about your organization, remind your employees of the ongoing obligations regarding your company and potentially get the employee to sign a release. But to protect yourself, stick to a standard script – and keep anyone with an emotional investment in the process out of the room.

Startup owners: Got a legal question about your business? Submit it in the comments below or email Curtis directly. It could end up in an upcoming “Ask the Attorney” column.

Disclaimer: This “Ask the Attorney” post discusses general legal issues, but it does not constitute legal advice in any respect. No reader should act or refrain from acting on the basis of any information presented herein without seeking the advice of counsel in the relevant jurisdiction. VentureBeat, the author and the author’s firm expressly disclaim all liability in respect of any actions taken or not taken based on any contents of this post.